NAND Oversupply Could Crater SSD Pricing To 8 Cents Per Gigabyte Next Year

Anyone who has been paying attention will have noticed that solid state drive prices have come down over the few months, and the year as a whole. It is now relatively affordable to buy a 512GB or even 1TB SSD, especially if you catch one on sale. Well, things may be getting even better for consumers. There is an oversupply of NAND flash memory that is expected pushes SSD prices down even further, this year and into 2019.

How low are we talking about here? Jim Handy, an analyst with Objective Analysis, said he expects the market for NAND flash memory to correct itself, or even bottom out altogether, to actual cost of production of 64-layer 3D NAND flash, The Register reports. That would put the price at around $0.08 per gigabyte.

Handy is not alone in his assessment of the DRAM market. DRAMeXchange, a division of TrendForce, reports that the DRAM flash market has stated in a state of oversupply since the first quarter of 2018, causing a 15-20 percent drop in the average contract prices.

"Looking ahead to 3Q18, there are noticeable signs that the demand growth will be limited despite the contributions from the traditional busy season. Shipments of mainstream consumer electronics products such as smartphones and notebooks during 3Q18 are not expected to increase significantly. Also, memory module makers will be carrying high levels of inventory. Therefore, DRAMeXchange analyst Ben Yeh notes that the average selling prices of NAND Flash products are expected to drop further by nearly 10 percent," DRAMeXchange says.

In addition to lower prices, the market research firm predicts we will see more shipments of high capacity SSDs, such as 8TB and even 16TB models, for the server market. On the consumer side, notebook vendors will opt for 256GB and 512GB configurations, rather limit options to 128GB and 256GB models.

Don't shed any tears for memory chip makers while all this is happening. Even though there is an oversupply of chips and a decrease in average selling prices, all of the major chip makers saw quarterly revenue growth from the NAND flash memory market, including Samsung, Toshiba, WDC, Micron, SK Hynix, and Intel.